Adelstein first FCC Commissioner to support 700 MHz “open access”

As rules for the upcoming 700MHz spectrum auction are drafted at the FCC, …

If "open access" and "700MHz" auction make your eyes glaze over, you're not alone. But it's worth paying attention; if "open access" rules are adopted for the auction, any company from AT&T to startups could access to the spectrum. Think of this as the equivalent of the FCC requiring telcos to lease out DSL lines at wholesale rates (now no longer required) and you'll understand what's at stake; it could soon be time to say goodbye to the duopoly of cable and DSL.

Saying that the FCC's current 200Kbps baseline for defining broadband is "a joke," FCC Commissioner Jonathan Adelstein took the stage here at NXTcomm in Chicago and called for the US to take a bold step forward. Defending himself against claims that he was promoting a "command and control" economy, Adelstein insisted that government could set targets and lay down rules that would allow the market to better benefit US consumers. As part of that vision, Adelstein publicly announced his support for open access rules in the upcoming 700MHz auction, which will provide around 60 MHz of spectrum that has been vacated by analog TV stations as they migrate to digital broadcasts.

Under an open access system, the spectrum might be auctioned off to a wholesale company who would have the right to develop a national wireless network with incredible propagation characteristics (passes easily through walls and over great distances). The company would maintain the network and lease out bandwidth to consumer-facing providers, who would be able to compete for customers on price and features. (We covered one such proposal last week.)

Open access is also supported by people like presidential candidate John Edwards, who recently asked the FCC to support the plan. "As much as half of the spectrum should be set aside for wholesalers who can lease access to smaller start-ups," Edwards said in a letter, "which has the potential to improve service to rural and underserved areas. Additionally, anyone winning rights to this valuable public resource should be required not to discriminate among data and services and to allow any device to be attached to their service. Finally, bidding should be anonymous to avoid collusion and retaliatory bids."

Such a setup would mean that the projected "third broadband pipe" into the home wouldn't be controlled by any one company, and wouldn't get snatched up by the incumbent bidder with the deepest pockets. Such incumbent bidders might have little reason to innovate (it might threaten their other businesses) or might use the band to boost only their cell phone coverage.

Adelstein claimed that US customers "are paying more for less bandwidth" and said that government needs to set up better rules to guide the market. Heading off criticisms about government regulation, he said that the government had no role to play in defining specific technical standards or business models, but that it could provide benchmarks and timetables for service and availability of things like broadband.

His statements mark the first time one of the FCC commissioners has publicly supported open access proposals in the upcoming spectrum auction. The statement is significant since the auction rules are currently being drafted and should appear by the end of the summer. The FCC is required by law to complete the auction by January 2008, but can choose how it wants to run it.